Chattel Mortgage Benefits You Can Still Access Post-Tax Time
Think the EOFY deadline was your last chance to secure tax savings through finance? Not quite.
Even after June 30, chattel mortgages continue to offer significant GST and tax benefits—especially if you’re purchasing business equipment, vehicles, or machinery.
Here’s what Australian businesses need to know about making smart finance moves after tax time.
What Is a Chattel Mortgage?
A chattel mortgage is a type of business loan where the lender provides funds for an asset (e.g. vehicle, equipment), and the business takes immediate ownership. The asset is used as security, and the mortgage is released once the loan is repaid.
It’s one of the most popular asset finance structures in Australia—particularly for small to medium businesses.
According to the Australian Bureau of Statistics (ABS):
85% of Australian small businesses finance capital purchases rather than buying outright.
Vehicle and equipment finance makes up a large portion of commercial loans, especially post-COVID, with government incentives further accelerating uptake.
Why Post-June 30 Still Matters
There’s often a rush to settle loans by June 30 to lock in deductions for the closing financial year. But even after EOFY, many benefits still apply, especially for purchases that support new-year growth plans.
Key Tax and GST Benefits You Can Still Access
1. GST Input Credits
If your business is GST-registered:
You can claim the full GST on the purchase price in your next BAS—even if the asset is financed via chattel mortgage.
This applies to cars, trucks, machinery, office equipment, etc.
Example: For a $100,000 asset (ex-GST), you can claim $10,000 in GST credits in the next BAS cycle—improving cash flow significantly.
2. Depreciation and Interest Deductions
Even if EOFY has passed:
The interest portion of repayments is tax-deductible.
You can claim depreciation on the asset annually through your tax return.
According to ATO guidelines, depreciation can be applied to any business-use asset with a life over one year—even if financed.
3. Instant Asset Write-Off / Temporary Full Expensing
While the Temporary Full Expensing scheme ended in June 2023, the government has proposed new thresholds for the Instant Asset Write-Off from 1 July 2023 to 30 June 2024:
Eligible businesses (turnover under $10 million) may deduct up to $20,000 per asset purchase.
Check ATO updates for confirmation and updates.
Perfect for Equipment & Vehicle Upgrades
Chattel mortgages remain ideal for financing:
• Commercial vehicles
• Construction machinery
• Medical or industrial equipment
• Tools and technology
They’re especially effective when your business wants ownership of the asset rather than lease-style usage, with long-term deductions.
Global Context: Still Relevant Worldwide
Globally, businesses in the UK, US, and Canada also benefit from similar structures, like hire purchase or secured equipment loans. However, Australia’s GST and depreciation rules make chattel mortgages uniquely beneficial—particularly for small businesses looking to improve post-COVID cash flow.
Why Work With a Broker Like Thrift Capital?
Each lender may treat asset classes, repayment terms, or business types differently. At Thrift Capital:
• We match you with lenders who understand your industry
• We know what documentation is truly required (no unnecessary paperwork)
• We help you secure approvals fast—often within 48 hours for qualified applications
Next Steps: Make Your Finance Work Harder
Even after June 30, the benefits are far from over.
Thinking about an equipment upgrade?
Talk to a Thrift Capital broker today to explore your options, or
Checkout our free Pre-Approval Checklist to get started.